Thinking about hiring your first employee? then this article is for you. Taking on your first employee can seem like a very complex and daunting task However, it is a vital aspect of running a successful business. In this post, we will provide you with a step-by-step guide on how to pay employees in the UK.
Determine the correct pay rate
It is important to determine the correct pay rate for each employee. This will depend on their job role, experience, and any applicable industry standards. As an employer, it is essential to comply with UK government guidance on minimum wage rates.
Set up a payroll system
We recommend setting up a payroll system. This can be done in-house or outsourced to a payroll service provider. As an employer, you are responsible for deducting income tax and national insurance contributions from your employees’ pay and paying them to HM Revenue & Customs (HMRC).
Obtain a national insurance number
We advise obtaining a national insurance number (NINo) from each employee. This is used to ensure that the correct amount of national insurance contributions is deducted from their pay.
Provide employees with a payslip
As an employer, it is essential to provide employees with a payslip each time they are paid. At Beckett Taylor, we recommend including details of their gross pay, deductions, and net pay. It is also important to keep records of all payslips for at least three years.
Submit Real Time Information (RTI) to HMRC
As part of the payroll process, you must submit Real Time Information (RTI) to HMRC each time you pay your employees. we suggest using payroll software or HMRC’s online services to submit RTI.
Provide a P60 at the end of the tax year
At Beckett Taylor, we advise providing your employees with a P60 at the end of each tax year. This shows the total amount of pay, deductions, and national insurance contributions for the tax year. As an employer, you are legally required to keep records of all P60s for at least three years.
Comply with employment law
We understand the importance of complying with employment law when paying your employees. This includes issues such as minimum wage, working time regulations, and discrimination. Failure to comply with employment law can result in legal action and reputational damage for your business.
Paying employees in the UK requires careful planning and attention to detail. By following the steps outlined above, you can ensure that you comply with tax and payroll regulations, and provide your employees with accurate and timely payments. we are here to help you navigate this complex process and ensure that your business runs smoothly
Contact us for a no obligation chat if the thought of going through taking your first employee on seems overwhelming
